The local balance between civil servants and private workers is beginning a dramatic shift as Democrats push to increase federal control of tasks once outsourced to contractors with government ties.
About 39,000 jobs would be added to the Department of Defense alone by 2015, according to Secretary Robert M. Gates, and about 11,000 of those jobs would be converted from jobs previously held by private contractors. Their share of work would drop from 39 percent to its pre-Sept. 11 level of 26 percent.
Thousands more jobs would be added to the rolls at agencies from Energy to Education as Congress and the Obama administration push “insourcing,” which they say will give the government more control over the cost and quality of goods and services.
Some free-enterprise advocates warn that the shift is shortsighted.
“Now, the government is guaranteeing itself an inflexible wage system, a less flexible working corps and overall higher costs for potentially less output,” said Daniel Goure, a former Defense official now at the Arlington-based Lexington Institute, a policy think tank. “The few private contractors that have been bad are now tainting everyone else’s reputation.”
But public outrage over perceived abuses from the contracting sector, as well as what many see as its inordinate growth since the start of the Iraq war, has created a comfortable stage for proponents of more insourcing.
“There were a lot of projects delegated out during the Bush administration that didn’t make any sense,” said John Donahue, a professor at Harvard’s Kennedy School of Government and author of “The Warping of Government Work.” “A corrective to that is probably a good idea.”
The recent push began in 2007 when the Democratic Congress, elected largely on anti-war sentiment, passed a defense authorization bill requiring the Pentagon to draw down its contractor work from besmirched firms like Blackwater and Halliburton.
Between 2007 and 2008, the Washington region gained about 6,300 federal government jobs, up 2 percent from the year before, according to the Department of Labor. It was the largest year-to-year jump since the area’s 8,500 federal jobs created in the wake of Sept. 11.
In March, President Barack Obama signed an omnibus spending bill requiring all federal agencies to do as Defense did and develop strategies for phasing out contract work in favor of civil employees.
The employment trend is continuing into 2009. In February, more than 350,000 Washingtonians lined the federal payroll, up from fewer than 343,000 at the same time last year.
In past years, as federal jobs have been created, private contracting jobs have fallen away. Immediately after Sept. 11, the “professional and business services” category that includes contractors lost 9,600 jobs. Conversely, boom times for the contracting sector have coincided with government job declines, as throughout the 1990s.
Insourcing “will create a bigger public sphere by definition, but that’s the idea,” Donahue said. “We have to be prepared to ignore, tentatively, a lot of objections to bigger public employment per se.”
But advocates of outsourcing many government functions are blunt about the dangers of too much government control. “It will raise costs, reduce flexibility and hurt overall readiness,” Goure said.
